Circle the letter of the best answer The following eve evnts took place at a manufacturing company for the current year (1) Purchased $95,000 in direct materials. (2) Incurred labor costs as (3) Other (4) follows: (a) direct, $56,000 and (b) indirect, $13 ,600 acturing overhead was $107,000, excluding indirect labor. Transferred 80% ofthe materials to the manufacturing assembly line. (5) Completed 65% of the work-in-Process during the year. (6) Sold 85% of the completed goods. (7) There were no beginning inventories. What is the journal entry to record the direct labor costs for the period? A. Labor Inventory Xxx Wages Payable .lwork-In. Process Xxx Inventory Wages Payable Manufacturing Overhead Wages Payable D. Wages Expense Cash XXX Ans. A.Option A B. Option B C. Option C D. Option D 9. Activity-based costing (ABC) is a costing technique that uses a two stage allocation Which of the following statements best describes these two stages? Ans. A. The costs are assigned to activities, and then to the products based upon their use of the activities. B. The costs are assigned to departments, and then to the products based upon their use of activity resources. C. Service department costs are allocated to the production departments, and then to the products based upon their use of the activities. D. Indirect costs are assigned to activities, and then to the products based upon the direct cost resources used by the activities. 10. Which one of the following accounts is not used in an activity-based costing (ABC) system? Ans. A. Materials Inventory B. Work-in-Process Inventory C. Finished Goods Inventory D. Allocations Incurred